Concerned over growing illegal futures trade in commodities, the sector regulator Forward Markets Commission (FMC) has started holding training programmes for police forces across states where such trading has proliferated.
According to the industry estimates, the size of illegal futures trade (also known as 'dabba trading') in commodities is expected to be up to Rs 3,00,000 crore a day in the country.
"The illegal futures trade in commodities is a serious concern. Since the FMC does not have much of investigating staff, we are trying to leverage the strength and number of state police forces. With all our limitations, we have tried to do a few things," FMC Chairman Ramesh Abhishek said.
Last week, a training programme for state police force was held in Bhopal, Madhya Pradesh.
"A similar programmes will be conducted next in Chattisgarh, Gujarat and other states," he said.
As commodity derivatives trading is a very technical matter to understand, police officers are being trained to distinguish between legal and illegal futures trade, he added.
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Abhishek further said, "We are giving them [police officers] a detailed material about the FCR Act, the rules, various FIRs filed in the FMC, ceased documents from the spot dabba trade market."
Besides, the FMC has designed six advertisements to create awareness about illegal trade in commodity futures market. The advertisements aim to alert all participants about risks involved in dabba trading, he said.
The advertisements alert investors that they should not try to trade in commodities futures unless they understand the market and not get lured by promises of high and quick returns. They should all make informed decision, he added.
"These advertisements are going to come out in a big way. We will do it in the national and vernacular media. We will take up this on electronic media too," the FMC said.
The regulator, which has been conducting 900 awareness programmes every year along with bourses, said it would focus more on creating awareness about dabba trading in areas which are most affected.
The FMC chairman noted that early passage of the Amendment Bill of the Forward Contracts (Regulation) Act (FCRA), 1952, which is still with the Standing Committee for consideration, would give more teeth to the commission to address this menace.